LOCAL GOVERNMENT CODE
CHAPTER 62. ABOLITION OF MUNICIPALITIES
SUBCHAPTER A. AUTHORITY AND PROCEDURE
§ 62.001. ABOLITION OF CORPORATE EXISTENCE. A
special-law municipality with 10,000 or fewer inhabitants or a
general-law municipality may abolish its corporate existence as
provided by this subchapter.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 62.002. PETITION AND ELECTION. (a) The mayor of the
municipality shall order an election on the question of abolishing
the municipality's corporate existence if a petition requesting
that the election be held is submitted to the mayor and is signed by
at least 400 qualified voters of the municipality. However, if a
majority of the qualified voters of the municipality is less than
400, the petition must be signed by at least two-thirds of the
qualified voters of the municipality. If the municipality has less
than 400 qualified voters and has no municipal debt and does not
provide services that would be otherwise provided by the county,
the petition must be signed by at least 50 qualified voters in the
municipality.
(b) The mayor shall order the election to be held on the same
date as the next general election at which the office of mayor is to
be filled.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987. Amended
by Acts 2001, 77th Leg., ch. 402, § 8, eff. Sept. 1, 2001.
§ 62.003. ELECTION ORDER; CONDUCT OF ELECTION. The
election shall be ordered, conducted, and canvassed in the same
manner as is required for an election to incorporate the
municipality, except that the mayor of the municipality shall
perform all acts that would be performed by the county judge.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 62.004. DECLARATION OF ABOLITION; CERTIFICATION. If
a majority of the votes received in an abolition election are for
abolition, the mayor of the municipality shall declare the
municipality abolished and certify the abolition to the
commissioners court of the county in which the municipality is
located. The commissioners court shall enter the abolition order
in its minutes, at which time the municipality ceases to exist.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
SUBCHAPTER B. RECEIVERSHIPS
§ 62.041. APPLICATION FOR AND APPOINTMENT OF
RECEIVER. (a) Any creditor of a validly incorporated
municipality that abolishes its corporate existence may apply to a
district judge in the district in which the municipality is located
to appoint a receiver for the municipality.
(b) After an application is filed and proper notice of the
application is posted, the judge hearing the application in term
time or vacation may appoint a suitable person as receiver.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 62.042. NOTICE OF APPLICATION. Before a judge may
appoint a receiver, written notice stating the substance of the
application for the appointment of the receiver and when and before
whom the application will be heard must be posted at three or more
public places in the county in which the municipality is located,
one of which must be in the municipality itself.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 62.043. BOND. (a) A judge appointing a receiver
shall set the receiver's bond at an amount that is at least twice
the probable amount of the indebtedness or the value of the property
of the municipality.
(b) The bond must be conditioned that the receiver will
faithfully perform the duties of receiver and that the receiver
will pay and deliver all money and property acquired as receiver to
the parties entitled to the money or property.
(c) The bond must be approved by the judge who appoints the
receiver.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 62.044. FILING AND RECORDING ORDER AND BOND. The
district clerk of the county in which the abolished municipality is
located shall file the receiver's bond and the order appointing the
receiver with the minutes of the court, and the clerk shall record
the order and the bond in the minutes.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 62.045. DUTIES AND AUTHORITY. (a) After the
receiver gives the required bond, and after the bond is filed and
recorded, the receiver shall:
(1) take control of all real and personal property of
the abolished municipality, including money, minute books,
ordinances, and similar property, but not including property that
pertains to the public schools or that is devoted exclusively to
public use; and
(2) in the next term of the court in which the
receivership is pending, return to the court an inventory of the
property taken by the receiver.
(b) Under a court order, or an order of the judge if the
court is in vacation, the receiver may bring suit against any person
in possession of the property of an abolished municipality or who is
indebted to it in the same manner as the municipality could if it
were still incorporated.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 62.046. COMPENSATION. A court appointing a receiver
under this subchapter may authorize compensation for the receiver.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
SUBCHAPTER C. PAYMENT OF INDEBTEDNESS AND DISPOSITION OF ASSETS
UNDER RECEIVERSHIP
§ 62.081. PRESENTATION OF CLAIMS. A person who has a
claim against an abolished municipality must present a verified
statement of the amount of the claim to the receiver within six
months after the date the receiver is appointed.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 62.082. NOTICE OF CLAIMS. (a) A receiver may not
allow or approve a claim or account against an abolished
municipality until notice of presentment of the claim or account is
given by publication in a newspaper in the municipality in which the
claim is filed or presented for four consecutive weeks or, if a
newspaper is not published in the municipality, by posting the
notice for four consecutive weeks at the door of the courthouse of
the county in which the municipality is located.
(b) The published or posted notice must state:
(1) the name and residence address of the creditor;
(2) the amount and date of the claim and account; and
(3) the purpose for which the claim or account was
incurred.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 62.083. APPROVAL OF CLAIMS. If the receiver of an
abolished municipality determines a claim is correct, the receiver
shall mark it as allowed and file it in the district court. The
court shall also approve the claim at its next regular term if no
protest is filed. On approval by the court, the claim is a valid
debt of the municipality.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 62.084. COMPLETE OR PARTIAL DISALLOWANCE OF
CLAIM. (a) If a receiver of an abolished municipality determines
that a claim is partially or completely unjust, the receiver shall
endorse his finding on the claim and return it to the claimant.
(b) A claimant who accepts the findings of the receiver may
file the claim with the district court. The court shall act on the
part of the claim allowed in the same manner as other claims.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 62.085. TAXPAYER PROTEST. (a) A district court may
not approve a claim against an abolished municipality until the
full amount of the claim is established by the judgment of a court
of competent jurisdiction if a taxpayer of the municipality:
(1) files a protest against the claim in the district
court; and
(2) files a bond that is conditioned that the taxpayer
will pay all costs of suit if the claimant fully establishes his
claim by the judgment of a state court with jurisdiction of the
claim.
(b) The taxpayer's bond must be approved by the court in
which it is filed.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 62.086. SUITS TO ESTABLISH CLAIMS. (a) A claimant
may bring a suit against the receiver of an abolished municipality
to establish a claim the receiver completely or partially
disallowed or to establish a claim protested by a taxpayer.
(b) The receiver shall assert all applicable legal defenses
against a suit under this section.
(c) The court trying a suit under this section may hear and
consider any material defense against the claim except limitation,
even if the claim previously has been reduced to judgment. However,
the court shall consider a prior judgment establishing the claim as
prima facie evidence of the justness of the claim.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 62.087. ALLOWANCE AND APPROVAL OF ESTABLISHED
CLAIMS. A receiver of an abolished municipality shall allow, and a
district court shall approve, a claim that is established by a
judgment against the receiver.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 62.088. LIABILITY FOR COSTS. (a) A claimant in a
suit against the receiver of an abolished municipality who rejects
part of the claimant's claim is liable for the costs of the suit
unless the claimant establishes the claim in an amount greater than
the amount allowed by the receiver.
(b) A claimant in a suit to establish his claim because of a
taxpayer protest under Section 62.085 is liable for the costs of the
suit unless the claimant obtains a judgment for the full amount he
asked the district court to approve.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 62.089. LIMITATIONS. (a) Limitations do not begin
to run, do not expire, and may not be pled to bar a claim against an
abolished municipality until six months after the date a receiver
is appointed for the municipality.
(b) A claimant may not bring a suit against the receiver of
an abolished municipality on a claim that is partially or
completely disallowed under Section 62.084 or against which a
taxpayer files a protest under Section 62.085 after six months
after the date the claim is disallowed or the protest is filed.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 62.090. PAYMENT OF CLAIMS. The court in which the
receivership of an abolished municipality is pending shall:
(1) provide for the payment of the claims legally
established against the municipality;
(2) determine the priority of the claims;
(3) order the sale of all property held by the receiver
that is subject to sale for the satisfaction of the municipality's
indebtedness; and
(4) direct the receiver to pay the claims legally
established against the municipality.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 62.091. ADDITIONAL TAX. (a) If the money of an
abolished municipality and the proceeds from the sale of its
property are insufficient to pay its indebtedness, at the request
of any creditor the court in which the receivership is pending at
its first regular term each year shall levy a tax on all real and
personal property that is not exempt from taxation and that on the
first day of January of the preceding year is located within the
corporate limits of the municipality as those limits previously
existed.
(b) The court shall levy a tax sufficient to discharge the
municipality's indebtedness, except that the court may not set the
tax at a rate that is greater than the rate allowed by law for such
purposes in municipalities.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 62.092. ASSESSMENT AND COLLECTION OF TAX. (a) The
tax assessor-collector for the county in which an abolished
municipality is located shall assess and collect a tax ordered
under Section 62.091.
(b) The tax assessor-collector shall pay the taxes
collected to the receiver for the municipality.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 62.093. DELINQUENT TAXES. A receiver for an abolished
municipality may bring suit against a delinquent taxpayer and
enforce a lien against the taxpayer's property in the same manner as
if the corporate existence of the municipality had not been
abolished and the levy and assessment had been made by the
municipality's governing body and assessor.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 62.094. DISTRIBUTION OF ASSETS. (a) The
compensation of the receiver, court costs, and expenses have
priority over other claims against an abolished municipality and
shall be paid first out of money on hand or collected.
(b) Money collected each year from taxes shall be paid pro
rata on claims according to their priorities until all claims
established against the municipality and all costs and expenses are
paid in full.
(c) After the final settlement of the receivership, the
receiver shall deliver money or other property remaining to the
trustees or other officers in charge of any public school district
located completely within the boundaries of the abolished
municipality, and the money or property shall be used for the
benefit of the school district. If there is no such public school
district, the receiver shall deliver the remaining money or
property to the county in which the municipality is located. The
money shall be deposited in the general fund of the county, and the
property shall be used for the benefit of the county.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
SUBCHAPTER D. SCHOOLS AND PUBLIC PROPERTY
§ 62.121. ADMINISTRATION OF PUBLIC SCHOOLS. If at the
time a municipality is abolished under this chapter the public
schools of the municipality are managed by trustees appointed or
elected by the voters of the municipality or by its governing body,
the trustees shall continue to manage the schools for the remainder
of their appointive or elective term.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 62.122. TAXES. A receiver for an abolished
municipality shall collect all unpaid taxes levied before the date
of abolition for municipal or school purposes, together with any
penalties or interest that is due. The receiver shall pay the part
of the taxes levied for maintaining the public schools to the
trustees of the school district, who shall use the taxes for the
purpose for which they were levied.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 62.123. PUBLIC PROPERTY. If a municipality abolished
under this chapter owns public buildings, public parks, public
works, or other public property on the date of abolition and the
property is not sold or disposed of under this chapter, the
commissioners court shall manage and control the property for the
purposes for which the property was originally used and intended.
In managing and controlling the property, the commissioners court
may exercise the powers originally given by charter to the
governing body of the municipality.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
SUBCHAPTER E. PAYMENT OF INDEBTEDNESS AND DISPOSITION OF ASSETS BY
CORPORATE OFFICERS OR TRUSTEES
§ 62.161. SETTLEMENT BY CORPORATE OFFICERS. (a) If a
municipality or de facto municipality that has indebtedness
outstanding is abolished, declared void by a court of competent
jurisdiction, or ceases to operate and exercise municipal
functions, the municipality's officers at the time the municipality
is dissolved or ceases to function shall:
(1) take control of the municipality's property;
(2) sell and dispose of the municipality's property;
and
(3) settle the debts owed by the municipality.
(b) For the purpose of settling the debts of the
municipality, the former municipal officers may levy and collect a
tax on the residents of the municipality in the same manner as the
municipality could have done.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 62.162. SETTLEMENT BY TRUSTEES. (a) If a
municipality's officers fail or refuse to settle its affairs under
Section 62.161, on the petition of any resident taxpayer of the
municipality or any holder of an evidence of its indebtedness, a
court with jurisdiction and located in the county in which the
municipality is located shall appoint three trustees to take
control of the municipality's property, dispose of the property,
and settle its debts.
(b) The trustees have the same powers that municipal
officers have under this subchapter.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 62.163. ACTION FOR DEBT. (a) The holder of an
indebtedness against a municipality to which Section 62.161 applies
may bring a suit to establish the indebtedness in any court in this
state with jurisdiction in the county in which the municipality is
located. The court may render judgment in the suit against the
municipality as fully as if the municipality had not been abolished
or its organization declared void. The status of the municipality
remains the same insofar as it affects the holders of its
indebtedness until the indebtedness is paid.
(b) The municipality may be served with process in the suit
by serving the citation on a person who was or who acted as the
mayor, the secretary, or the treasurer of the municipality at the
time of the municipality's abolition.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
SUBCHAPTER F. ABOLITION OF MUNICIPALITY CEASING TO HAVE RESIDENTS
§ 62.201. PETITION FOR ABOLITION. After the 120th day
after the date a municipality ceases to have any persons residing
within its boundaries, the owners of a majority of the land within
the municipality may file a petition with a district court of the
county in which all or a majority of the land in the municipality is
located requesting the court to abolish the municipality.
Added by Acts 1989, 71st Leg., ch. 1, § 8(a), eff. Aug. 28, 1989.
§ 62.202. HEARING. (a) Before the 60th day after the
date the petition is filed, the district judge of the court shall
hold a hearing on the petition. Members of the public who wish to
give testimony on the matter of abolishing the municipality must be
given the opportunity to do so at the hearing.
(b) The district judge must publish notice of the hearing in
a newspaper of general circulation in the county in which all or a
majority of the land in the municipality is located. The notice
must be published before the 10th day before the date of the
hearing. The notice must state:
(1) the date, time, and place of the hearing;
(2) the purpose of the hearing; and
(3) the name of the municipality that is the subject of
the hearing.
Added by Acts 1989, 71st Leg., ch. 1, § 8(a), eff. Aug. 28, 1989.
§ 62.203. ABOLITION ORDER. At the conclusion of the
hearing or within 10 days after the date the hearing is concluded,
the district judge shall issue an order declaring the municipality
to be abolished if the judge finds that a valid petition was filed
and no persons reside within the municipality. The municipality
ceases to exist on the date the order is issued.
Added by Acts 1989, 71st Leg., ch. 1, § 8(a), eff. Aug. 28, 1989.
§ 62.204. NOTICE TO COMMISSIONERS COURT. On the
issuance of the order abolishing the municipality, the district
judge shall certify the abolition to the commissioners court of the
county in which all or a majority of the land in the abolished
municipality is located.
Added by Acts 1989, 71st Leg., ch. 1, § 8(a), eff. Aug. 28, 1989.
